This article is from the Australian Property Journal archive
ING Industrial Fund has bought an industrial property portfolio in Germany for €58.4 million ($A97.4 million) and two industrial properties in Australia for $A27.8 million.
The German properties were acquired at an 11% discount to valuation through a sale and leaseback transaction with the logistics provider Fiege Group.
Fiege is the largest privately owned logistics company in Europe and one of the top three logistics players in the region.
Fiege’s total sales in 2004 was in excess of €1.5 billion.
The six properties are 100% leased for an initial term of 10 years plus an additional 10 year option, and will provide an initial yield of 8.5%.
IIF’s chief executive Paul Toussaint said the German acquisitions will increase IIF’s diversification in Germany, the world’s third largest economy.
“As the world’s largest exporter of goods, Germany serves as an important logistical hub for the entire Eurozone, with an excellent road and rail system and proximity to the rapidly growing markets of Eastern Europe.
“This transaction has been sourced off market through ING’s relationship with Fiege which demonstrates our ability to source attractively priced assets in Europe,” he added.
Whilst in Australia, IFF has bought two properties which are leased to Brambles and Nylex with terms of 10 and 9.2 years respectively, and will provide an initial yield of 7.6%.
Brambles currently occupy a 7,220 sqm office warehouse and 14,350 sqm hardstand at the Westland Industrial Estate in Erskine Park, New South Wales.
Whilst Nylex is accommodated in a 16,740 sqm office warehouse at the Seaford Industrial Estate in Seaford, Victoria.
The combined $125.2 million acquisition reflects an overall initial yield for the eight properties of 8.2%.
The fund has also invested in a further joint venture development with ING Real Estate. The property comprises a development site of 2.2 hectares at the corner of Baker Street and Moore Streets in Banksmeadow, New South Wales.
The transaction involves an initial investment from IIF of $14.1 million representing 75% of the total consideration. The property will be leased to VISY for a minimum term of two years.
Following the transactions, IIF’s portfolio will increase to $3 billion worth of assets of which $407 million is located in Europe.
The transaction will be funded via a combination of equity and Euro dollar denominated debt. An institutional placement will be undertaken by UBS AG, Australia Branch to raise $92 million. New units issued will be allotted on August 11, 2006 and rank equally with existing units for the September 2006 distribution.
By Adam Parsons
